Europe’s governments are running out of options

From the Baltic to the Balkans, politicians are struggling to stay in office while implementing savage savings programmes

For the governments of Europe in the midst of the EU’s worst ever crisis, it is getting increasingly difficult to reconcile internationally ordained austerity packages with popular acquiescence in spending cuts, job losses, and slashed budgets.

Whether using the euro or not, governments from the Baltic to the Balkans are struggling to stay in office while implementing the savage savings programmes dictated by technocrats from Brussels, Washington, and Frankfurt.

Athens will again be seething with rage on Tuesday when two of the biggest unions have called a 24-hour general strike. Trapped between the demands of their constituency and the dictates of international creditors, governments and political leaders all across Europe are running out of options.

The problem is made worse by the popular perception in several of the affected countries that the political class is akin to a mafia – politicians in cahoots with bankers and property developers or businessmen fleecing the country to the point of bankruptcy then leaving the public to pick up the pieces – wage cuts, job losses, higher taxes, health, education, and retirement services decimated, all of it policed by faceless technocrats flying in from Brussels and Washington.

Such has been the perception of the Boc government in Romania, ditto in Greece and Ireland.

Since the euro crisis erupted two years ago, governments in all three so-called “programme” countries, those being bailed out by the EU and the IMF, have fallen as a direct consequence — in Ireland, Portugal and Greece.

The crisis also brought down the seemingly insuperable Silvio Berlusconi in Italy as well as José Luis Zapatero in Spain. But the political pain has been felt not only on the debtors’ side of the bailout equation.

Among the euro creditors, resort to taxpayers’ money to rescue the profligate has been highly unpopular, contributing to a change of government in Finland, a series of regional election losses for Chancellor Angela Merkel’s Christian democrats in Germany, and a harsher, more eurosceptic mood in the Netherlands. The crisis is now playing strongly in Europe’s key election campaign this year in France where Nicolas Sarkozy has overseen a loss of the country’s credit rating parity with Germany and where the leftist frontrunner, François Hollande, is pledging to ease up on the austerity deemed to be needed to shake up the country.

In the EU, but outside the eurozone, the debt crisis is also taking its toll, as shown by the fate of the Romanian government. Next door in Hungary, the divisive prime minister, Viktor Orbán, is having to eat humble pie, reverse a previous spurning of outside help, and perform a U-turn on economic policy in order to try to secure a €20bn lifeline from the EU and the IMF.